Withdrawal of a lump sum of up to 10% of one’s pension pot upon retirement in the Netherlands will not be possible until 2029, according to the Dutch government’s Spring Budget.
This means its introduction will be postponed until after the transition to a pension system based on defined contribution (DC) arrangements.
It is the eighth time that the entry into force of the lump sum has been postponed.
Last spring, then pensions minister Eddy van Hijum moved the date from 1 July 2025 to 1 July 2026, adding that “the final date will depend on the progress of the parliamentary process”.
The House of Representatives gave the green light for the lump sum in 2024, the Senate has yet to do so.
Pension transition
In the past, some senators have demanded that the introduction of a lump sum be postponed until after the end of the Dutch pension transition, which sees pension funds converting their existing defined benefit (DB) arrangements to new DC arrangements.
PFZW chair Joanne Kellermann said it would be “extremely unfortunate” if pension funds had to implement the lump sum during the transition, during a roundtable discussion organised by the senate last year.
Van Hijum and his successor in the outgoing cabinet, Mariëlle Paul, held off on this.
One of the reasons they gave for the move was that postponement costs €26m per year because of missed tax receipts. They also pointed to the 2019 Dutch Pension Accord, which had promised the introduction of the lump sum.
The Senate can now continue discussing the lump sum.
In the country’s Second Chamber, only a handful of smaller parties voted against the lump sum, while a large majority was in favour.
It can, therefore, be expected that the Revised Lump Sum Act will easily pass in the Senate, where parties that support the lump sum together have 64 of 75 seats.
This article was first published on Pensioen Pro, IPE’s Dutch sister publication. It was translated and adapted for IPE by Tjibbe Hoekstra.
